Tag: BitCoin

Over 27‚000 cryptocurrency investors have fallen victim to one of the biggest Bitcoin scams to hit South Africa, TimesLive reported.

Hawks spokesman Captain Lloyd Ramovha confirmed the commercial crimes unit was investigating complaints against BTC Global‚ a company which asked investors to send their cryptocurrency to an online wallet address.

Many of the victims were South African, but the extent of the scam spread to the US and Australia.

“The amount is over $50 million and could rise as more victims come forward‚” said Ramovha.

He said the company was being investigated for violating the Financial Advisory and Intermediary Services Act, but could not confirm whether it was a Ponzi scheme or if the people behind it are South African.

Victims from South Africa told TimesLive they had invested between R16‚000 and R1.4 million with BTC Global.

BTC Global’s selling point was the skill of its “master trader” Steve Twain, whom many victims believe does not exist.

BTC Global promised investors that if they sent their Bitcoin to its wallet address they would receive guaranteed returns of 14% per week.

Its website now displays a message which states that Steven Twain is missing and calls for victims to stop threatening harm to the admin team.

Craig Wright, the self-proclaimed inventor of Bitcoin, is accused of swindling more than $5-billion worth of the cryptocurrency and other assets from the estate of a computer-security expert.

Wright, who claimed in 2016 that he created the computer-based currency under the pseudonym Satoshi ‎Nakamoto, allegedly schemed to use phony contracts and signatures to lay claim to bitcoins mined by colleague Dave Kleiman, another cryptocurrency adherent, who died in 2013, according to a lawsuit filed by Kleiman’s brother.

Kleiman’s family contends they own the rights to more than 1 million Bitcoins and blockchain technologies Kleiman mined and developed during his lifetime and that the assets’ value exceeds $5 billion, according to the Feb. 14 filing in federal court in West Palm Beach, Florida.

“Craig forged a series of contracts that purported to transfer Dave’s assets to Craig and/or companies controlled by him,’’ lawyers for Kleiman’s family said in the complaint. “Craig backdated these contracts and forged Dave’s signature on them.’’

Wright, an Australian who lives in London, couldn’t immediately be reached for comment on the suit, which also accuses the entrepreneur of violating partnership duties to Kleiman and unjustly enriching himself at his colleague’s expense. There is no attorney listed for Wright on the docket.

Wright and Kleiman formed a Florida-based company, W&K Info Defense Research LLC, in 2011 to focus on cybersecurity, according to the court filing. The pair also had earlier worked together on the development of Bitcoin and had extensive mining operations, according to the family’ s lawsuit.

The pair controlled as many as 1.1 million Bitcoins at the time of Kleiman’s death, according to the suit. They were held trusts set up in Singapore, the Seychelles Islands and the U.K., the suit says.

Wright said in a 2016 blog post and interviews that he was the main participant in a team that developed the original Bitcoin software under the pseudonym Satoshi Nakamoto. After skeptics questioned the claims, Wright said that he decided not to present any further evidence to prove that he is the creator of Bitcoin.

In the filing, Kleiman’s brother includes what he says is email traffic between himself and Wright in which the entrepreneur indicates he may have been holding 300,000 of Kleiman’s Bitcoins.

Dave “mentioned that you had 1 million Bitcoins in the trust and since you said he has 300,000 as his part,’’ the computer expert’s brother wrote. “I was figuring the other 700,000 is yours,” he added in the email. “Is that correct?”

“Around that,” Wright wrote back. “Minus what was needed for the company’s use.”

The case is Ira Kleiman v. Craig Wright, No. 18-cv-80176, U.S. District Court for the Southern District of Florida.

Forbes has released its list of the richest people in the cryptocurrency community.

The net worth of those on the rich list is denoted in range estimates based on estimated cryptocurrency holdings, post-tax profits from cryptocurrency trades, and stakes in cryptocurrency-related businesses.

The net worth estimates reflect the estimated holdings of the rich list as of 19 January 2018.

Forbes acknowledged that it may have missed certain major cryptocurrency holders due to the obfuscated nature of blockchain transactions.

The top 10 richest people in cryptocurrency, according to Forbes, are below:

Armed robbers broke into the family home of a city financier turned Bitcoin trader and forced him to transfer the digital currency at gunpoint, in what is believed to be the first heist of its kind in the UK.

Four robbers in balaclavas forced their way into the home of Danny Aston, 30, who runs a digital currency trading firm, before reportedly tying up a woman and forcing Mr Aston to transfer an unknown quantity of the cryptocurrency.

Mr Aston lives in the picturesque village of Moulsford in South Oxfordshire, where episodes of Midsomer Murders have been filmed, in a rented four-bedroom converted barn estimated to be worth at least £700,000 on a private drive.

Police were called at around 9.40am on Monday to attend the home after raiders are reported to have entered the property by kicking down the door.

The Mail on Sunday reported that the men tied up a woman and kept a baby outside in a pram while forcing Mr Aston to transfer the Bitcoin. The value of a single Bitcoin is now around £8,000.

A neighbour confirmed on Sunday the property where the violent burglary took place, but said that Mr Aston and a woman believed to be his partner left Moulsford on Monday to stay with relatives and have not returned.

They said: “I was not here at the time, but I know the couple have left and are staying with relatives, they haven’t been back since.

“We are all obviously a bit shaken up, even though a few days have passed now. It is not what you expect to happen around here.”

Mr Aston – who lives with his 31-year-old business partner Amy Jay, according to the latest Companies House records – previously worked at Trayport, a London-based financial software company that operates a platform for trading energy commodities.

In June 2017, he established his own digital currency firm just before Bitcoin’s huge surge in value in July, according to Companies House.

Both Mr Aston and Ms Jay are listed online as directors of Aston Digital Currencies Ltd, and a company called Butler Hosting, which specialises in “data processing, hosting and related activities”.

A user named Danny Aston has previously been active on trading site Poloniex, which allows users to trade and store digital currency.

A local resident described the victim of the attack as well-known, but suggested that the small village community had been left dazed by the news.

“Everyone is shocked I think,” he said. “We think we live in a safer space, and then this happens and everyone gets scared.”

The village of Moulsford is home to two schools and a girl from Cranford House Prepatory School described how the students were told to get to safety as the armed robbery happened nearby.

She said: “We were all told to get down on the floor and stay in the middle of the schoolroom. All the curtains were closed and the doors locked. No-one knew what was going on but it was scary to say the least.”

Bitcoin is a digital currency that allows users to trade anonymously and securely across the internet without regulation or a central bank

It is understood that although Bitcoin’s secrecy will make the theft in Moulsford much more difficult for the police to investigate, there is a chance that the stolen currency will appear on the market as thieves try to exchange it into conventional money.

In the last 12 months, Bitcoin’s value has risen over 1000 per cent. It hit an all-time high on 17th December, when it was worth over £13,500.

A police spokesman said: “Thames Valley Police is investigating an aggravated burglary which occurred at a property in Moulsford on Monday.

“Officers were called at about 9.40am to a report that offenders had entered a residential property off Reading Road and threatened the occupants. No one was seriously injured during the incident.

“An investigation into the incident is underway and officers attended nearby Moulsford School as a precautionary measure. It is not believed there was a threat to anyone at the school.

“Officers are particularly interested in speaking to anyone travelling through the village on the A329 Reading Road between 7.30am and 10.30am on Monday who has Dashcam footage or anyone with mobile phone footage.

“People in the local community may notice an increased presence of officers in the area while our enquiries are ongoing. The investigation is in its early stages however initial enquiries suggest this may be a targeted incident.

The South African Revenue Service (SARS) has said that it will soon provide some much-needed clarity on the tax implications for transferring and purchasing Bitcoin and other cryptocurrencies. They have advised that traders should declare in the meantime if they need to.

eNCA spoke to SARS about the ever-growing use of cryptocurrencies in the country. While SARS is treating cryptocurrencies as part of Capital Gains Tax, head of SARS tax research Randall Carolissen said they are still exploring it further.

“Because by the very nature it lends itself to money laundering and anonymised trading, so yes we have to put in and place additional regulations. And to that end, we are going to release an interpretation note from our legal department to guide taxpayers as to their implications with respect to this Bitcoin technology,” Carolissen told eNCA

SARS revealed that it is also working with top global technology companies that are doing similar work regarding crypto and tax. With block chains being incredibly difficult to monitor, the deductions will depend on what coin is used.

“Since it’s not legal tender it is treated as an asset in your hands. And depending on your intent with this asset, it can trigger different tax instruments. It can either be a revenue nature or it could be an asset, capital gains tax in nature,” Carolissen said.”

“People need to come forward and regualise their tax affairs with us. And the guideline will also assist them with that. But as and when you submit your tax returns you must declare that as either additional income or additional asset revenue realisation that you’ve had. So it’s very important that you don’t discard that or ignore that part. Especially those people who took advantage of Bitcoin in the early stages.”

Bitcoin surpassed $10 000 for the first time, taking this year’s price surge to more than 10-fold even as warnings multiply that the largest digital currency is an asset bubble.

The euphoria is bringing to the mainstream what was once considered the providence of computer developers, futurists and libertarians seeking to create an alternative to central bank-controlled monetary systems. While the actual volume of transactions conducted in cryptocurrencies is relatively small, the optimism surrounding the technology continues to drive it to new highs.

Bitcoin has risen by more than 50% since October alone, after developers agreed to cancel a technology update that threatened to split the digital currency. Even as analysts disagree on whether the largest cryptocurrency by market capitalisation is truly an asset, its $167bn value already exceeds that of about 95% of the S&P 500 Index members.

This is a bubble and there is a lot of froth. This is going to be the biggest bubble of our lifetimes
“This is a bubble and there is a lot of froth. This is going to be the biggest bubble of our lifetimes,” hedge fund manager Mike Novogratz said at a cryptocurrency conference Tuesday in New York.

Novogratz, who’s says he began investing in bitcoin when it was at $90, is starting a $500m fund because of the potential for the technology to eventually transform financial markets.

There’s no agreed authority for the price of bitcoin, and quotes can vary significantly across exchanges. In Zimbabwe, where there’s a lack of confidence in the local financial system, the cryptocurrency has traded at a persistent premium over $10 000. Volumes are also difficult to assess. Bloomberg publishes a price that draws on several large bitcoin trading venues. It was at $10 166.98 as of 12:02pm Tokyo time.

From Wall Street executives to venture capitalists, observers have been weighing in, with some more sceptical than others as bitcoin’s rise has grown steeper, sweeping along individual investors. The number of accounts at Coinbase, one of the largest platforms for trading bitcoin and rival ethereum, has almost tripled to 13m in the past year, according to Bespoke Investment Group.

Futures contracts

In a move toward mainstream investing, CME Group has said it plans to start offering futures contracts for bitcoin, which could begin trading in December. JPMorgan Chase & Co, the largest US bank, was weighing last week whether to help clients bet on bitcoin via the proposed futures contracts, according to a person with knowledge of the situation.

The rising profile of digital currencies even saw bitcoin feature in the US senate confirmation hearing Tuesday for Federal Reserve chairman nominee Jerome Powell, who’s a current board member. Answering a senator’s question, he said that “cryptocurrencies are something we monitor very carefully”, and that at some point their volumes “could matter” for monetary policy, though not today.

The total market cap of digital currencies now sits north of $300bn, according to data on Coinmarketcap.com’s website.

For Peter Rosenstreich, head of market strategy at online trading firm Swissquote Bank, bitcoin’s surge harks back to the surprises of the UK referendum on European Union membership and US President Donald Trump’s election.

“We have underestimated the populist movements,” he said. “There is growing unease on how central banks and governments are managing fiat currencies. Ordinary people globally understand why a decentralised asset is the ultimate safe haven.”

In what its backers are calling “potentially a world first for a major grocery retailer”, shoppers were for a “limited time” able to pay for their groceries using bitcoin at a Pick n Pay retail store in Cape Town.

In a statement posted on its website, Cape Town-based specialist software payments development house Electrum, said customers at Pick n Pay’s campus store at its head office were able to use the bitcoin cryptocurrency to purchase groceries and services.

“The checkout process is as simple as scanning a QR code using a bitcoin wallet app on the customer’s smartphone,” the statement said. See demonstration video from Electrum below.
The checkout process is as simple as scanning a QR code using a bitcoin wallet app on the customer’s smartphoneIt quoted the retailer’s information systems executive Jason Peisl as saying that although bitcoin and other cryptocurrencies are “still relatively new payment concepts”, Pick n Pay has been able to “effectively demonstrate how we are able to accept such alternative payments”.

Pick n Pay did not say when or even if it planned to expand the pilot to other stores. However, Pick n Pay deputy CEO Richard van Rensburg has subsequently told Business Day that the retailer doesn’t expect to begin accepting bitcoin in the near term. He said the trial has since ended.
“We are unlikely to roll out the solution until the payments industry and regulatory authorities have established a framework for managing the risks associated with cryptocurrencies,” Van Rensburg is quoted as having said. “We have proved to ourselves, though, that it is technically possible to roll out a solution very quickly.”
Electrum provided the cloud-based enterprise payments platform used for the transactions, while the bitcoin infrastructure for the project was provided by Luno, a bitcoin company active in Southeast Asia and Africa, and with an office in Cape Town.

According to Electrum’s website, major major retailers and financial institutions use the company’s technology to accept payments, process loyalty transactions and provide value-added services. Its customers include two out of Africa’s top three retailers.

The way that cryptocurrencies have been implemented – with blockchain technology – is absolutely not a viable consumer product, says South African entrepreneur Hannes van Rensburg.

Van Rensburg, who sold his payments platform Fundamo to Visa for $110 million (R1.4 billion) in 2011, was speaking at StartupGrind Cape Town on Thursday evening, reports Ventureburn.

He said that cryptocurrrencies that use the blockchain won’t see the same kind of adoption as credit or debit cards because of the impracticality of settling payments on the blockchain.

“I think there are a lot of things that could happen in the back. I think there’s a lot of things that could happen around settlement of transactions and so forth, but it is a fallacy. I know people are going to shoot me, but I am just a straight shooter,” said Van Rensburg.

One of van Rensburg’s biggest sticking points is the way in which cryptocurrency transactions take place – also arguably one of their biggest selling points.

“If I do a transaction in Bitcoin it means that before it is actually concluded with the text in the distributed ledger, 50% plus one of the participants in this ecosystem have to acknowledge that they have written it into the ledger,” he said

“Now just consider if you were to run it as a global currency where, before you walk out of the shop having bought my packet of chips for a dollar, half the population has to acknowledge that I bought a packet of chips. It isn’t going to work in that environment.”

Van Rensburg said that he still believed that blockchain was an important technology – just not one that is consumer-driven.

Good for business but not for consumers

Van Rensburg’s viewpoint is not a unique one, with many financial experts around the world voicing their concern about the commercial applications of Bitcoin and other cryptocurrencies.

Regulatory uncertainty is a big hurdle, especially in the financial-services industry. Legal frameworks, globally, will have to change to adapt to the growing use of the new technology, said a former former US Reserve official speaking to the Wall Street Journal.

There are also issues of cybersecurity; despite backers of blockchains claiming that they are secure by design, the technology hasn’t been adopted widely enough yet for it to be seriously tested.